ICMA publishes new paper with reflections and recommendations for the sustainable fund market in a new regulatory environment
25 March 2025 The International Capital Market Association (ICMA) has published a new paper with reflections and recommendations for the sustainable fund market in a new regulatory environment.
Recent regulatory initiatives in the EU and the UK around fund categorisation, labelling, and naming will significantly impact a largely European industry that already reorganised in response to the EU’s SFDR in 2019.
In this paper, we identify the implications of these regulations while looking at current market practices based on the results of a targeted research and building on our prior publications.
We conclude by proposing priorities for a common roadmap for regulators and the market, while also making several recommendations relating, among other factors, (i) to consistency for a future SFDR review to avoid future disruption and/or discouragement of the sustainable fund market which will have substantially rebranded because of recent initiatives, (ii) to inclusiveness for the assessment of sustainable investments which should be feasible thanks to official and leading market taxonomies, as well as other established assessment tools, and, (iii) to the need to identify investments, such as those in the fossil and hard-to-abate sectors, that cannot necessarily be accommodated by other sustainable funds to grow transition-themed funds resulting from EU and UK regulations.
